Solution
Executive Summary
In this report, an evaluation of external reward environment and management changes likely in the next year has been evaluated. Other than this, impact of the change on the benefits and remuneration of employees, management team and executives have been evaluated. In line with this analysis, issues that relate to expatriate employees enrolling in long-term job functions with a set of recommendations in this case established. For the purpose of achieving the set report aims, Garrard organisation which an oldest Jewellery Company globally has been selected for evaluation. The factors of consideration entail Brexit policy, minimum wages, COVID-19 pandemic, increased technologies adoption in HR strategy and varying socio-economic aspects in UK external reward environment. In coming year, this report has noted potential reward management changes to include the employees engagement owing to prevalence of COVID-19 pandemic, transitioning generation Y and Z to workplace, social networking and environment factor. The outcome of this entail reviewing of remuneration and varying environment factors. The outcome of this entail reviewing the pay and benefits, diversifying of skills including technical. For Expatriates, the areas of prioritisation would entail cultural changes, expatriation costs incurred, language barriers and relevant skilled/knowledgeable people included in workplace. This is core to establish sustainable reward management process.
Table of Contents
2.0 Organisation external reward environment and key reward management changes in the coming year 3
2.1 Organisation External Reward Environment 3
2.2 Key Reward Management likely to occur in coming Year 6
3.0 Evaluation of Change impacts to Pay and Benefits of Employees, Management and Executives. 8
4.0 Issues considered in taking into account expatriate workers on long-term assignments 10
Appendix 1: PESTLE Analysis 17
Appendix 2: Cost/Benefits and Implementation Plan. 17
1.0 Introduction
Reward management is noted as a strategy to carry out analysis and controlling employees pay, rewards and benefits. The relevance of reward management is noted by CIPD (2019) as being due to employers encountering a lot of pay for workers management aspects. Traditionally, the area of interest is for attracting, retaining and motivating employees to meet employers demands. At the start, it was structured in a way it reflect the capacity for individualised employees, responsibility to execute allocated job roles in varying job contracts and employer affordability. Garrard organisation (Garrard, 2020), it currently engages upto 100 staff from UK. Hence, pay is informed by the employees experiences and the job roles and performance as opposed to hourly wages. The importance of this entail training season ticket loans, Perkbox and Childcare vouchers. As evidenced in Bahdanau et al. (2018) the existing reward systems have significantly changed evident in technology and innovation. As vision 2030 approaches, more jobs would be available for people filling them effectively. The outcome of this is existence of a talent-guided market, reward management being instrumental to assist entities in gaining their uniqueness and attraction and retention of most appropriate candidates. Other than the rapid technology change, Lee et al. (202) highlight that in modern business environment, the COVID-19 pandemic has similarly contributed to uncertainties in labour markets redefining future of workplace operations. This aspect directly impact reward management strategy. Considering the identified background information. In this report, an evaluation of external reward environment has been pursued with key reward management changes in coming year put into account. The impact of changes on pay and employees, management and executive benefits and expatriates of employees on long-term assignments.
2.0 Organisation external reward environment and key reward management changes in the coming year
2.1 Organisation External Reward Environment
Founded in 1735, Garrard organisation is a London, UK based organisation which is affected by a set of external environmental factors (Garrard, 2020). For the purpose of understanding the organisation’s external reward environment, PESTLE analysis is applicable which is noted in Widya Yudha et al. (2018) as an appropriate framework focusing on the aspects of politics, economic, technological, legal and environment influencing an organisation from outside has been considered. Through a focus on the identified factors, there is a possibility of guiding strategic decision-making process in reward management through consideration of employer demands changes including soft skills competencies and developing technologies.
Political
In UK case, reward environment is politically influenced by Brexit as it has an impact on trends in employment strategy. The rationale of this is influencing employees demand with the right skills and attitude, supply of workers with right skills and attitude and retention in workplace informed by pay and benefits provided. Further, Pope et al. (2020) identify the Coronavirus Job Retention Scheme in UK with furloughed employees being offered with approximately 80% of the government remuneration with employers facilitating the entire practice.
Economic
An increase in globalisation trend in entities in Jewellery industry in UK has a direct implication on Gerrard reward approach. The rationale of this is to deal with internal and external influences in global reward management. This is since the globalisation factor has a direct impact on the Gerrard reward approach. This is supported by Radović-Marković et al. (2019) research work which evidence globalisation as having been established to lead to immense competitive context in addressing clients, staff and different stakeholders’ interests. The result of this is employers required to be actively engaged in designing and implementing international reward systems and recognition programs. Owing to the decline in economic growth owing to the prevalence of COVID-19 pandemic, Gerrard has less resources for supporting their remuneration strategy. The outcome of this has been an increase in the overall labour costs (remote work/flexible working) and pay ratios and gaps.
Social
An increase in gaining population highlight generation changes in workplace having an impact on Gerrard practices. Besides, today, 20% of working population of age 10-24 years evidence generations as transitioning to employment (UK Key Data, 2020). In regard to younger population, Generation Y/Millennials prefer flexible working hours and remote working rather than remuneration. This is nevertheless not the phenomenon on elderly Generation X, with their preference being remuneration and benefits and also career growth. Employees overall health and wellbeing also represent a core aspect of reward environment as prioritised prior pay. According to Radović-Marković et al. (2019), an efficient reward management make sure that they attain a high-level job satisfaction which is a positive and significant impact linked with extrinsic rewards. The job satisfaction has a direct implication on the employees health and wellbeing. This is informed by CIPD (2020) which note that social environment of rewards has a direct impact on lowering stress levels, improving sleep and increasing metabolism scope.
Technology
An increased technological development in UK has contributed to improving electronic products and services provision to the population with e-Government agenda set as a priority. As evidenced in Mediyanti et al. (2020) report, real-time interaction and instant gratification has significantly been impacted by the technology increase scope. In the same scope the employees are expecting to be recognised appropriately by intranet systems or the social tools of use. Additionally, consistency in remuneration are facilitated by the application of the 360-degree feedback with the focus being increase in pay awards harnessed by available technologies.
Legal
In UK context, the National Minimum Wage Act 2018 (Majchrowska & Strawiński, 2018) impact on Garrard organisation operations with the employees of age 25 and above required to be paid £8.21 with those of age 21 to 24 rewarded £7.70 hourly with younger employees of age 16 to 17 years being offered £4.35 for every hour worked. Also, Equality Act 2010 note men and women as required to be paid equally for pursuing same roles (ACAS, 2020). Further, in line with the Act provisions, it is against the law to discriminate any employees in their remuneration owing to possessing of protected characteristics. For Garrard organisation, it has significant issues evidenced with tribunal cases and also bad press being evident. This has a direct implication on their overall image and brand value to leverage on competitive advantage.
Environment
The COVID-19 pandemic has contributed to an increase in vigilance of the employees for future pandemic through an alignment of employees work environment systems. By ethical sourcing, relevant rewards are provided with customisation to the employees need for fitness to work on the entity. A case example is in Gerrard rewards organisation where Perkbox being their core area of benefits make sure the employees live in an appropriate environment with improvement of health and safety requirements.
2.2 Key Reward Management likely to occur in coming Year
From the findings of PESTLE Analysis, it can be argued that the potential changes to occur in coming year would entail;
Transition from Traditional to Total Rewards and to Strategic Rewards
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